GR 132415; (January, 2002) (Digest)
G.R. No. 132415 ; January 30, 2002
MIGUEL KATIPUNAN, INOCENCIO VALDEZ, EDGARDO BALGUMA and LEOPOLDO BALGUMA, JR., petitioners, vs. BRAULIO KATIPUNAN, JR., respondent.
FACTS
Respondent Braulio Katipunan, Jr., owner of a lot and apartment in Manila, entered into a Deed of Absolute Sale on December 29, 1985, selling the property to brothers Edgardo and Leopoldo Balguma, Jr. for ₱187,000. The sale was facilitated by his brother, petitioner Miguel Katipunan, and the Balgumas’ father, Atty. Leopoldo Balguma, Sr. Title was subsequently transferred to the buyers. Respondent later filed a complaint for annulment of the deed, alleging he was deceived into signing what he believed was an employment contract for work abroad through the machinations of the petitioners. He claimed he never received the consideration and was ignorant of the transaction’s true nature, having only a third-grade education.
The Regional Trial Court dismissed the complaint, finding respondent failed to prove his allegations and noting his admissions about obtaining loans and signing the deed. On appeal, the Court of Appeals reversed the RTC, annulling the deed and ordering the restoration of the title to respondent. The appellate court gave credence to a psychiatric certification indicating respondent had very low comprehension, which the trial court had arbitrarily disregarded. The petitioners elevated the case to the Supreme Court via a petition for review on certiorari.
ISSUE
Whether the Deed of Absolute Sale is voidable due to respondent’s incapacity to give consent, having been vitiated by fraud or deceit.
RULING
The Supreme Court denied the petition and affirmed the Court of Appeals’ decision, with modification regarding the return of rentals. The legal logic centers on the vitiation of consent under Article 1330 of the Civil Code. The Court found that respondent’s consent to the contract was not intelligently, freely, and voluntarily given. The expert psychiatric testimony, which the RTC erroneously rejected, was crucial in establishing respondent’s mental condition—his slow comprehension and low IQ—making him susceptible to deception.
The Court held that while the trial judge’s personal observations of a witness’s demeanor are ordinarily accorded great weight, such observations cannot prevail over contrary expert medical evidence, especially when the trial court’s assessment is unsupported and arbitrary. The petitioners failed to refute the psychiatrist’s findings. Consequently, the contract was voidable due to fraud or deceit. The restoration of the property and its fruits (rentals collected) to respondent was ordered as a proper consequence of annulment, pursuant to Article 1398 of the Civil Code. The Court emphasized the mandate of Article 24 to protect parties who are at a disadvantage due to ignorance or mental weakness.